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Mascot Towers apartment owners in Sydney close to securing millions in payout from NSW government an

· In short: The ABC understands the proposal has secured the required 75 per cent support from owners.

· The deal is between 141 residential and commercial owners, several banks and a third-party buyer group.

· What's next? The NSW government is yet to determine the total cost of the proposal.

Apartment owners who bought into the uninhabitable Mascot Towers in Sydney are on the brink of securing a multi-million-dollar payout from the New South Wales government, almost five years after their ordeal began. 

Residents of the complex in Sydney's inner-south are millions of dollars out of pocket, after cracks were discovered in the building's basement in 2019.

The 10-storey building remains empty, while owners' assets are now worth a fraction of the price.

The NSW Building Commissioner David Chandler has led negotiations between 141 residential and commercial owners, several banks and a third-party buyer group.

The deal would allow apartment owners to finally move on, but they will still incur major losses.

Mr Chandler's initial offer, which was conveyed to owners in a series of closed-door meetings in late December, did not include assistance for owners who had already paid off their mortgages.

NSW Building Commissioner David Chandler co-ordinated the deal between owners, banks and a third-party buyer group. ( ABC News: Craig Hansen )

But the ABC understands the updated proposal, with added assistance for non-mortgage holders and investors, has received the required 75 per cent support from owners.

Owners looking for closure

Shelter NSW chief executive John Engeler, who has acted as an intermediary between owners and the government, said most owners just wanted closure.

"There will be a number of people who will still be bitterly disappointed and probably rightly so," he said.

"It's not perfect but it's good enough so that people can get on with their lives."

In its final proposal, the NSW government said it had secured in-principle support from banks to discount owners' mortgages by up to 40 per cent.

If an owner-occupier has debt remaining after their unit is sold and their mortgage is discounted, the government will pay the rest of the loan.

Unit owner Rachel Williams said owners had been "forced into a corner" in accepting the deal, with no prospect of a better resolution.

"There is no win here," she said.

Ms Williams thanked Mr Chandler for his work in listening to residents' concerns, but said "Premier Chris Minns and Fair Trading Minister Anoulack Chanthivong needed to show their faces".

For investors and owner-occupiers without mortgages, the government is offering means-tested support payments of up to $120,000, on top of the sale of their unit.

Owner-occupiers over 65-years-old who do not have a mortgage will receive up to $360,000 in means-tested government support, in addition to the sale, because they had a "lower long-term earning capacity."

The NSW government is yet to be determine the exact cost of the proposal.

Mr Engeler praised Mr Chandler's success in getting banks to agree to the deal.

"I think David has pulled a very big rabbit out of a very small hat here," he said.

The government support is dependent on the sale of the lots to a third-party consortium, which is expected to buy the apartments for a total of about $30 million.

If every owner sold, that would be an average of $212,700 per lot.

Unit owners are expected to receive their offers from the buyer by the end of the week.

One owner contacted by the ABC, who stands to lose up to $2 million, said they were glad the ordeal would be over.

Mr Engeler has described the Mascot Towers fiasco as a "perfect storm" of "regulatory systemic and system-wide failure," and said he did not believe a situation as dire would happen again in NSW.

The NSW government has since introduced a string of stricter building regulations, including latent defects insurance which is intended to cover owners' costs of fixing building defects for up to 10 years.


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